'53 percent' claim untrue: Middle class, working poor pay taxes too

The Occupy Wall Street protesters have come up with a slogan that is snappy and true, calling themselves “the 99 percenters” who are losing ground against the top 1 percent.

Now, a group of conservative bloggers has come up with a retort. They call themselves “the 53 percenters,” a reference to the portion of Americans who must pay income taxes, and so, we are told, are “subsidizing” the rest of the country by carrying the freeloaders on their shoulders.

It is a catchy slogan. But it’s not true.

The federal income tax now accounts for less than half of federal revenue, down significantly from its share just a decade ago. Yes, it’s designed to hit the rich harder, and 47 percent of households don’t have to pay it, a number that has mushroomed since the recession hit and incomes declined.

But most federal revenues come from other taxes. Social Security and Medicare payroll taxes raise roughly as much as the income tax does, and they land disproportionately on middle-class and working poor families. We all pay the gas tax. And companies pass on the burden of the corporate tax in the form of higher prices.

Yes, wealthier people pay higher income taxes, by design. The income tax rate is intended to gradually increase as you move up the salary scale, which makes sense because wealthier people can afford to pay more.

But payroll taxes are regressive. They are flat taxes that impose the same rate on everyone — 12.4 percent of wages for Social Security and another 3 percent for Medicare, both split between the worker and the employer.

Remember, too, that Social Security taxes do not apply to income above $106,800 in salary. And one-third of all payroll in America goes to people earning more than that amount. So when it comes to Social Security taxes, a lower- or even middle-class family pays a higher portion of its income than a wealthy family does. Who are the freeloaders?

When the 53 percenters pretend they are carrying the entire load, they are being intellectually dishonest, plain and simple. If you look at the total federal burden, higher earners pay more, as they should. But everyone has skin in the game.

In the past 20 years, the majority of the economic gains America has made have gone to the richest 1 percent of earners. And yet that is precisely the group that has received the biggest tax cuts. That’s why the slogan of the Wall Street protesters hits the mark.

We can only marvel that anyone who looks across this country today can whine that 47 percent pay no incomes taxes. Most of the folks they’re referring to earn less than $25,000 a year. Do we really need to squeeze them a little harder? Isn’t the economy already squeezing them hard enough?